Primary reference: PSX Notice PSX/N-1294, dated 22 October 2026 · Detailed research review: 25 October 2026. Consult the original instrument and any later amendments; draft measures are not operative until approved and commenced.
The PSX/N-1294 consultation proposes detailed single-stock options rules: European-style calls and puts, a default 500-share contract multiplier, physical settlement at T+1, upfront buyer premiums, specified maturities and option pricing/fee methods. Comments close 5 November 2026.
Contract type, eligible shares, lot size and maturities
The proposal contemplates both call and put options using underlying stocks selected from the Deliverable Futures Contract-eligible universe. The contracts are European style, exercisable on expiry rather than throughout their term, with an initial multiplier of 500 shares per contract unless PSX notifies a different contract size.
Proposed contracts would cover the spot month and the next two calendar months, with a mechanism for 90-day or other maturities; the consultation describes monthly maturities in the initial phase. The standard expiry is the last Friday of the relevant month or the preceding trading day where that Friday is not a trading day.
The proposed strike range would generally keep at least three in-the-money, one at-the-money and three out-of-the-money contracts available, subject to a larger maximum range in the detailed draft. These are proposed product specifications, not instructions to begin trading immediately.
Settlement, premium, exercise and broker charges
Unlike cash-settled derivatives, the proposed single-stock options market settles through delivery of underlying securities on a T+1 cycle rather than the former T+2 specification. Buyers would pay the full option premium upfront on T+0 and would therefore not be subject to a buyer margin requirement for the premium.
The proposal contemplates automatic exercise of remaining in-the-money contracts under NCCPL assignment arrangements unless the option buyer acts in accordance with the applicable procedures. Broker commissions are proposed at a minimum of three paisa or 0.15%, whichever is higher, for relevant trades, with the schedule's treatment of squared transactions applied.
The draft Schedule of Charges specifies proposed PSX trading fee of Rs7 per Rs100,000 of traded value, regulatory fee of Rs0.88809 and SECP levy of Rs0.65 per Rs100,000, along with the applicable CCPF levy. These quoted amounts are draft terms only.
Pricing controls and how to comment
The draft inserts a daily option settlement price method based on volume-weighted averages (VWAP) over specified windows, falling back to theoretical Black–Scholes pricing where the volume threshold or intrinsic-value check is not met. It also provides for configurable price bands and definitions needed for risk controls.
PSX seeks public comments on its proposed changes to the PSX Regulations and Schedule of Charges by 5 November 2026. Replies may be sent to comments.rad@psx.com.pk under Notice PSX/N-1294.
The proposed rules require final regulatory approval and implementation arrangements. A prior Chapter 15A framework existed; the October notice proposes adjustments to its operation rather than establishing a live market solely by publishing a consultation.
What do the exact changes mean for affected organisations?
Brokers and clearing participants should review product eligibility, order/risk systems, contract lifecycle, delivery obligations and proposed fees against the complete Annexure A, and submit comments by 5 November.
Specific compliance and response checklist
- Study the complete 22-page PSX/N-1294 document, including the redline and fee schedules.
- Assess European-style exercise, 500-share contract multipliers, T+1 delivery and T+0 premium processing.
- Model buyer/seller exposure, daily settlement-price methodology, automatic exercise and NCCPL obligations.
- Submit written feedback to comments.rad@psx.com.pk by 5 November 2026.
Timing and legal status
PSX Notice PSX/N-1294 published 22 October 2026; consultation ends 5 November 2026. Proposed only; commencement not confirmed.
No new option contracts or charges should be represented as operative until the exchange and SECP publish the final approved framework. All examples derive from Annexure A.
PSX Notice PSX/N-1294 and 22-page Annexure A (proposed options-market rules and charges)